Wednesday, November 15th, 2017

 

Sapura Energy wins five contracts worth RM1.47b

PETALING JAYA: Sapura Energy Bhd has clinched five contracts with a total value of RM1.47 billion.

The oil and gas firm told Bursa Malaysia that Sapura Offshore Sdn Bhd was awarded contracts in relation to the Pan Malaysia transportation and installation of offshore facilities for Petronas Carigali Sdn Bhd and Sarawak Shell Bhd. The work will be executed throughout 2018.

Sapura Fabrication Sdn Bhd and partner Borneo Seaoffshore Engineering Sdn Bhd were awarded a contract for the provision of maintenance, construction and modification services under Package A (Offshore) – Sarawak Gas for Petronas Carigali.

The duration of the contract is five years expiring in September 2022 with an option to extend for another year.

Another contract awarded to Sapura Fabrication is the hook-up, commissioning and offshore construction services for Repsol Oil & Gas Malaysia Ltd. It is a call-out contract where works will be carried out according to work orders based on agreed unit rates and prices. The contract is for two years, expiring in September 2019 with an option to extend for another year.

Sapura Fabrication also bagged a contract for the provision of mechanical works for the flexi high-density polyethylene plant for the Rapid Project. Work is expected to be completed by March 2019.

Meanwhile, Sapura Energy Do Brasil LTDA received a contract to build a pipeline for UTE Porto de Sergipe 1 combined cycle power plant. Work is expected to finish by Dec 31, 2018.

Sapura Energy shares closed 5 sen or 3.4% lower at RM1.40 today.


Amcorp Properties Q2 earnings boosted by London project

PETALING JAYA: Amcorp Properties Bhd’s net profit for the second quarter ended Sept 30, 2017 jumped more than 14-fold to RM26.11 million from RM1.83 million a year ago due to higher share of joint ventures’ results.

In a filing with Bursa Malaysia today, it said the higher share of joint ventures’ results was due to profit recognition from the progressive delivery of sold units of the Burlington Gate project in London.

During the quarter, the company’s share of joint ventures’ results net of tax stood at RM42.24 million compared with RM9.91 million a year ago.

Revenue for the quarter fell 40.10% to RM31.73 million from RM52.97 million a year ago due to the sale of a piece of land in Pajam, Negri Sembilan, as well as lower sales achieved for Malaysian property projects.

For the six months ended Sept 30, 2017, net profit grew more than four-fold to RM27.44 million from RM6.30 million a year ago while revenue fell 27.54% to RM70.14 million from RM96.80 million a year ago.

The company expects its two joint venture projects in London, which will be completed in the current financial year, to contribute positively to its earnings, resulting in a higher profit for the financial year ending March 31, 2018.


Spain awarded €1.6b over Prestige oil spill

MADRID, Nov 15 — A court awarded the Spanish state €1.6 billion (approx. RM7.9 billion) in damages today over the 2002 Prestige oil spill, one of Europe’s worst environmental disasters. The court in the north-western Spanish city of A…


Japan government analysis sees economy closer to vanquishing deflation (VIDEO)

TOKYO, Nov 15 — Recent positive economic signs suggest Japan is breaking out the grip of deflation that has stunted growth for years, according to a government analysis obtained by Reuters that also cautions about the continued drag on growth…


TPP resurrection positive signal on trade: HSBC Global Research

PETALING JAYA: The resurrection of the Trans-Pacific Partnership (TPP), now known as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), sends signal that significant trade liberalisation is still feasible despite current populist challenges, according to HSBC Global Research.

“Estimates indicate that by 2030 an accord among the ‘TPP-11’ could boost trade in the region by 6% and provide welfare gains on the order of US$157 billion (not taking account of the suspended provisions),” HSBC chief trade economist Douglas Lippoldt said in a research note today.

Non-members such as China, India, Korea, Thailand and the US, however, could face modest net losses totalling US$10 billion (RM41.9 billion) as trade is diverted to CPTPP members.

The CPTPP countries have a combined gross domestic product (GDP) of US$10.1 trillion and a population of 500 million. Its share in international trade is roughly comparable to that of the North American Free Agreement (Nafta).

By establishing a high-standards accord between developed and developing countries on four continents, Lippoldt said the CPTPP agreement provides a useful demonstration of the feasibility of inclusive trade liberalisation projects that span diverse groups of countries.

As the CPTPP will provide a large market with generous terms of access, he noted that it may well attract additional members.

Lippoldt highlighted that the CPTPP could also position its members in Asia to benefit from parallel trade liberalisation efforts underway across the continent.

“These parallel initiatives could help businesses in CPTPP countries to gain further economies of scale, facilitating connections with additional trade partners and helping businesses boost productivity.”

On Nov 11, 11 Pacific Basin countries announced an agreement in principle for a Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

CPTPP’s member countries include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Lippoldt said the CPTPP is a high standards agreement that will liberalise trade in goods (eg: removing most tariffs), services and trade-related investment. It also provides support for labour standards and the environment, intellectual property rights, and the handling of customs issues.

However, 20 sensitive provisions affect handling of express shipments, investor rights (eg: on dispute resolution with states), and intellectual property rights will be suspended.

By suspending rather than deleting these provisions, the CPTPP members hope to facilitate a possible return of the US at some point.

Meanwhile, four further CPTPP areas remain to be addressed, namely state owned enterprises, coal, trade sanctions, and cultural exceptions.

The CPTPP members hope to finalise and sign the accord next year and it will enter into force once six countries have ratified it.


TPP resurrection ‘a boon to trade’

PETALING JAYA: The resurrection of the Trans-Pacific Partnership (TPP), now known as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), sends signal that significant trade liberalisation is still feasible despite current populist challenges, according to HSBC Global Research.

“Estimates indicate that by 2030 an accord among the ‘TPP-11’ could boost trade in the region by 6% and provide welfare gains on the order of US$157 billion (not taking account of the suspended provisions),” HSBC chief trade economist Douglas Lippoldt said in a research note today.

Non-members such as China, India, Korea, Thailand and the US, however, could face modest net losses totalling US$10 billion (RM41.9 billion) as trade is diverted to CPTPP members.

The CPTPP countries have a combined gross domestic product (GDP) of US$10.1 trillion and a population of 500 million. Its share in international trade is roughly comparable to that of the North American Free Agreement (Nafta).

By establishing a high-standards accord between developed and developing countries on four continents, Lippoldt said the CPTPP agreement provides a useful demonstration of the feasibility of inclusive trade liberalisation projects that span diverse groups of countries.

As the CPTPP will provide a large market with generous terms of access, he noted that it may well attract additional members.

Lippoldt highlighted that the CPTPP could also position its members in Asia to benefit from parallel trade liberalisation efforts underway across the continent.

“These parallel initiatives could help businesses in CPTPP countries to gain further economies of scale, facilitating connections with additional trade partners and helping businesses boost productivity.”

On Nov 11, 11 Pacific Basin countries announced an agreement in principle for a Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

CPTPP’s member countries include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Lippoldt said the CPTPP is a high standards agreement that will liberalise trade in goods (eg: removing most tariffs), services and trade-related investment. It also provides support for labour standards and the environment, intellectual property rights, and the handling of customs issues.

However, 20 sensitive provisions affect handling of express shipments, investor rights (eg: on dispute resolution with states), and intellectual property rights will be suspended.

By suspending rather than deleting these provisions, the CPTPP members hope to facilitate a possible return of the US at some point.

Meanwhile, four further CPTPP areas remain to be addressed, namely state owned enterprises, coal, trade sanctions, and cultural exceptions.

The CPTPP members hope to finalise and sign the accord next year and it will enter into force once six countries have ratified it.


Red Sena trims qualifying acquisition targets to a handful

PETALING JAYA: Red Sena Bhd, which saw its net loss widen to RM3.78 million in the fourth quarter ended Sept 30, 2017, said that it has narrowed its list of potential qualifying acquisition (QA) candidates to only a handful during the past six months.

It said that deal certainty and valuation are the two key challenges in the course of its engagement with potential vendors.

“The challenges of providing deal certainty to potential vendors and offering an attractive valuation are closely intertwined. One of the ways to improve deal certainty is to ensure that the QA valuation is attractive as perceived by the market. This will have a positive effect on the share price of Red Sena’s shares. For as long as the market price rises above the cash value, deal certainty is assured,” it added.

Despite the challenges, the company said it will persevere to conclude a QA. It noted that the ensuing quarter will be the last practicable window to sign a conditional sale and purchase agreement, in view of the approval process that it would have to go through.

Red Sena has until Dec 10, 2018 to secure a QA.

Meanwhile the company said its net loss widened on lower rate of returns from investment income from Islamic Murabahah deposits under the cash trust account. For the full year ended Sept 30, 2017, it posted a net loss of RM7.6 million on higher amortisation charge of public issue cost during the year.

Red Sena’s share price closed unchanged at 46 sen with a total of 320,000 shares traded today.


Red Sena trims QA targets to a handful

PETALING JAYA: Red Sena Bhd, which saw its net loss widen to RM3.78 million in the fourth quarter ended Sept 30, 2017, said that it has narrowed its list of potential qualifying acquisition (QA) candidates to only a handful during the past six months.

It said that deal certainty and valuation are the two key challenges in the course of its engagement with potential vendors.

“The challenges of providing deal certainty to potential vendors and offering an attractive valuation are closely intertwined. One of the ways to improve deal certainty is to ensure that the QA valuation is attractive as perceived by the market. This will have a positive effect on the share price of Red Sena’s shares. For as long as the market price rises above the cash value, deal certainty is assured,” it added.

Despite the challenges, the company said it will persevere to conclude a QA. It noted that the ensuing quarter will be the last practicable window to sign a conditional sale and purchase agreement, in view of the approval process that it would have to go through.

Red Sena has until Dec 10, 2018 to secure a QA.

Meanwhile the company said its net loss widened on lower rate of returns from investment income from Islamic Murabahah deposits under the cash trust account. For the full year ended Sept 30, 2017, it posted a net loss of RM7.6 million on higher amortisation charge of public issue cost during the year.

Red Sena’s share price closed unchanged at 46 sen with a total of 320,000 shares traded today.


Amway Q3 net profit falls almost 21%

PETALING JAYA: Amway (Malaysia) Holdings Bhd saw third quarter net profit fall almost 21% on lower sales and higher import costs primarily attributed to the weaker ringgit, which was partially offset by lower provision for sales incentives in line with lower sales.

The direct selling group made a net profit of RM14.95 million for the quarter ended Sept 30, 2017, compared with RM18.92 million for the same quarter in 2016.

The group’s revenue was also almost 7% lower at RM243.65 million, compared with RM261.69 million for the same quarter in 2016.

The group has declared an interim dividend of 5 sen for the quarter, bringing total dividend announced to 15 sen for the nine-month period.

Regarding its performance for the remaining period, the group expects slight improvement compared to the prior nine months, in line with positive Amway Business Owners (ABO) momentum following the start of the new ABO performance year. Nevertheless, foreign exchange impacts continue to exert pressure on the group’s margins.

The group will continue to proactively focus on strategies to (i) effectively manage operating costs to offset pressure on profitability and (ii) implement various sales and marketing initiatives, as well as ABO experience-related infrastructure to support the ABOs’ businesses.

Net profit for the nine month period ended Sept 30, 2017 was 9% lower at RM39.17 million, compared with RM43.15 million for the same period in 2016.

Revenue for the period was 12% lower at RM732.86 million, compared with RM836.50 million.


Boustead Heavy earnings drop in third quarter

PETALING JAYA: Boustead Heavy Industries Corp Bhd (BHIC) saw a 47.9% decline in net profit to RM7.75 million for the third quarter ended Sept 30, 2017 compared with RM14.88 million in the previous corresponding period, due to higher operating cost.

Revenue was down slightly from RM64.31 million to RM64.26 million.

It has proposed to declare an interim dividend of 2 sen per share for the quarter under review.

In a filing with the stock exchange, BHIC said despite the government’s announcement of a cutback on its defence spending in the current year’s budget, the group expects the contracts awarded recently to the joint venture companies to contribute positively towards its future earnings.

“In addition, the group will continue to pursue potential contracts with parties other than Ministry of Defence such as the Royal Malaysian Police and Malaysian Maritime Enforcement Agency as well as in foreign markets.”

Nonetheless, BHIC noted that commercial shipbuilding looks set to continue to come under pressure from low demand for ships, tonnage overcapacity, tight financing and uncertain economic outlook.

“This will continue to put pressure on shipyards which are already reeling from thin order book and cancelled deliveries.”

It added that the trend of oil majors scaling down on capital expenditure is expected to continue and pose challenges to players in the oil and gas industry for the major part of the year.

BHIC’s nine-month net profit, however, jumped 63% from RM21.1 million to RM34.4 million. Revenue came in at RM184.87 million, 6.2% lower than the RM197.05 million made a year ago.

Its shares fell 1 sen or 0.5% to close at RM2.01 today on some 23,700 shares done.